Severe flooding in North Queensland has impacted agricultural production, raising concerns about potential price increases for bananas and sugar. The federal treasurer warned of economic impacts and urged focus on the human cost of the disaster.
The price of bananas and sugar could rise as supplies are hit by severe flooding in North Queensland , the federal treasurer has warned. Jim Chalmers, speaking on Tuesday, said the flood-affected areas account for about four percent of the country's agricultural production. This means there will be some economic impacts, with initial estimates from Treasury suggesting that lost economic activity due to the flooding will reduce GDP in the March quarter by about 0.1 percent.
There may also be upward pressure on prices. Chalmers stated that up to 20 percent of Australia's banana crop could be affected by the disaster, while damage to road networks is also hindering supply chains. 'So you can see that there might be quite narrow but significant impacts on some goods like bananas and sugar, but we don't expect the overall impact on inflation to be substantial in aggregate,' he said. The treasurer emphasized that the government's primary focus remains on the 'human cost' of the flooding. 'The danger is still present,' he said. The clean-up process is just beginning for flood-stricken growers facing a challenging road ahead after weeks of torrential rain. Sugarcane, avocados, bananas, fishing, and livestock have all been significantly impacted by the relentless wet weather that has plagued north Queensland, claiming two lives. Rachel Chambers, chief executive of Queensland Fruit & Vegetable Growers, stated that it will take many weeks to determine the full extent of the damage. 'There is still rain happening in different parts of the region,' she said. 'Growers are still not able to go and assess the damage on their own farm, roads internally have been washed away, there is so much erosion that it almost makes going through the farm impossible – let alone going from farm to farm across local, state and federal road networks.' Chambers acknowledged that growers in North Queensland are a 'tough bunch' who have endured successive wet seasons – including recently, Cyclone Jasper. 'Right now, as you look around, growers are sending us photos of destruction of crops, of stuff that they have picked on trucks – and the trucks haven't been able to move for six, seven days. They know the fruit on board is rotting and they're not going to get a return at market,' she said. 'I think that day by day, it will be harder and heavier for growers, because there is such a big clean up.' The recent flooding has been a 'really difficult disaster' for almost one third of Queensland's sugarcane growers, Canegrowers chief executive Dan Galligan told SBS News. He said the impacts have been most pronounced around Ingham, in the Herbert River Valley region. 'That's around four million tonnes of cane in that area, most of which has been submerged and is only really is starting to see the light of day today, well after ten days when the rainfall started,' he said. 'It's certainly a significant impact.' Galligan explained that sugar cane is a 'resilient crop' capable of withstanding flooding or cyclones. However, the true impact on productivity won't be felt until later in the year when harvesting begins. He stated that newly-planted cane is very likely to have been lost entirely, and impacts will also be felt through damage to the local cane railway network. Galligan also mentioned that growers are still in the midst of crisis management, and it will take at least a week before they have a clear understanding of the financial impact. He noted that this impact will primarily be felt by the local community in Queensland, not consumers. 'The reality is, for the Australian consumer, it's not going to make much difference at all,' he said. 'We export over 85 per cent of the production that we have out of Queensland. Domestic sugar supply doesn't come out of this region, so the domestic sugar industry shouldn't have been impacted.' Despite this, Galligan anticipates a 'huge economic impact', particularly for the Ingham community. 'Every dollar that has been lost out of a farmer's pocket because of this flood has an impact,' he said. More rain is forecast in the north from Cape York Peninsula, down the tropical coast and into the Burdekin region, with 24-hour totals of up to 200mm before easing on Wednesday. About 200 trucks have been waiting for days at Townsville for roads to reopen. But with other road closures like the Macrossan Bridge near Charters Towers, nearly 100 trucks are still waiting to deliver their goods. Some regions may take some time to recover with at least six Gulf communities cut off by floodwaters
FLOODING NORTH QUEENSLAND BANANAS SUGAR PRICES AGRICULTURE ECONOMIC IMPACT
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